Fairtrade International part of new coalition to address low wages in the tea industry

02 May 2013

Fairtrade International has long been championing and advocating for industry-wide change in the tea sector. Today we welcome the Oxfam and Ethical Tea Partnership report Understanding Wages in the Tea Industry and are committed to playing an active role in the new coalition bringing together tea industry actors to address the challenges of low wages in the tea industry.

Fairtrade International, the global standards and certification body committed to tackling poverty through trade, has collaborated in the research programme on wages in the tea industry, alongside members of the Ethical Tea Partnership, Oxfam and other certification organisations. Fairtrade supported the work on Fairtrade certified tea estates in Malawi and Assam as regions where we had identified wage issues affecting workers – and were keen for deeper insight into the dynamics of the local tea industries to help identify solutions for the future.

Lee Byers, Fairtrade International’s Global Product Manager for Tea said progress across the industry on wage levels will only be achieved by also addressing price pressures through the supply chain, and improving trade practices. “With the publication of this report and the tea industry’s wider awareness of sustainability issues we are hopeful that there is now a willingness to put forward solutions to bridge the wage gap,” he said.

Globally, only 6 per cent of Fairtrade certified tea is sold under Fairtrade terms. This means at many tea estates only a small amount of Fairtrade Premium is received to enhance the lives of workers and their families. However, as a recent Fairtrade Foundation study in Malawi shows, where tea estates have been able to secure a higher proportion of sales on Fairtrade terms, there have been significant benefits to workers, including subsidised maize and fertiliser to improve food security, health and education programmes, and provision of solar panels for homes. Fairtrade directly contributes to alleviating poverty through payment of Fairtrade Premiums of over US$6 million per annum to small farmer organisations and plantation workers in the tea sector.

Fairtrade Standards already include a requirement to work toward living wages and Fairtrade International is now working on a project to define a clear process and benchmarks for employers to transition to paying a living wage to workers on Fairtrade certified plantations.

In 2012, Fairtrade launched a Workers’ Rights Strategy which includes a strong emphasis on trade union rights and wage bargaining following consultation with trade unions and other members of our Workers’ Rights Advisory Council, who provide ongoing valuable advice to help strengthen workers’ rights and income.

In 2013 and beyond we are reviewing the Fairtrade Hired Labour Standards and developing guidance on ways to progress towards a living wage and the empowerment of workers. We are also exploring how living wage calculations might be included in setting Fairtrade Minimum Prices, and aim to work with other certification schemes to establish common definitions, methodology and toolkits for calculating a living wage.

Participation in industry initiatives such as Tea 2030, a global project to build a sustainable industry for the future, and the next phase of this tea wages study, will also facilitate discussion on a new approach to setting tea industry wage benchmarks and the promotion of wage bargaining, so that better wages become a commitment of everyone along the tea supply chain.